According to Gartner®, “Legacy monolithic core systems slow innovation, prevent real-time data utilization, and render AI initiatives ineffective.” But while AI continues to dominate headlines, the latest retail trends from Gartner® highlights a much bigger issue beneath the surface: “Without accurate and timely data, particularly from the store, AI initiatives stall, leaving retailers vulnerable to inefficiencies and missed opportunities.” So, what are the biggest retail technology trends shaping 2026, and what should CIO’s, CTO’s and retail leaders be focusing on now?
Retailers Are Modernising Legacy Core Systems to Scale AI as a Strategic Enabler of Cost Optimisation and Revenue Growth
Retailers are increasingly under pressure to modernize ageing merchandising, POS and supply chain systems as AI adoption accelerates across the industry. In our opinion, Gartner® highlights that many legacy retail platforms are now becoming barriers to innovation, limiting real-time data visibility, slowing operational responsiveness and making it difficult for retailers to scale AI-driven capabilities effectively. As customer expectations around seamless shopping experiences continue to rise, retailers are being pushed toward more agile, cloud-native and modular technology environments.
The focus is no longer just on replacing old systems, but on creating connected retail operations that support faster decision-making, operational efficiency, and long-term scalability. Retailers are increasingly investing in cloud-native platforms, API-driven ecosystems, and real-time data integration to improve forecasting, inventory management and customer experience. From our understadning, Gartner® warns that retailers fail to modernise risk falling behind competitors already using AI-driven forecasting, replenishment and pricing capabilities to improve efficiency and protect margins.
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AI-Driven Transformation Is Pushing Retailers to Invest in Trusted Real-Time Store Insights and Unified Inventory Visibility
Unified inventory visibility is becoming a critical priority for retailers investing in AI-driven forecasting, dynamic pricing, and connected retail operations. Retailers are increasingly relying on real-time inventory data that connects stores, ecommerce and supply chain operations into a single, accurate view. But AI capabilities are only as effective as the data behind them. Fragmented inventory systems and delayed store updates create gaps that limit forecasting accuracy, fulfilment performance, and operational agility.
As customer expectations around availability and fulfilment continue to rise, retailers are investing in cloud-native inventory platforms, API-first integrations and real-time store insights to improve visibility across channels. These investments help retailers respond faster to demand shifts, improve inventory accuracy, and deliver more consistent customer experiences across physical and digital retail environments.
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Store-Associate-Facing GenAI Has Become a Key Capability to Enable Frontline Knowledge Work
The growing use of GenAI to support frontline retail teams and improve day-to-day store operations. Retailers are increasingly integrating AI assistants into workforce management platforms to help store associates and managers quickly access product information, training resources, HR policies, and operational updates through conversational interfaces. In our opinion, Gartner® 2026 CIO and Technology Executive Survey reveals that 67% of CIOs plan to increase their investment in associate-facing GenAI assistants in 2026. This highlights the growing importance of AI across frontline retail operations.
These changes reflect wider digital trends in retail, where retailers are looking for smarter ways to improve productivity and support employees with faster access to information. Retailers are now investing in new technologies for the retail industry that support real-time workforce insights, AI-powered task management, and connected store operations. These investments are also accelerating wider retail automation trends, helping managers automate repetitive tasks and improve store productivity.
Retailers Are Abandoning In-House AI Merchandising Builds as Agentic Assistants Prove Too Complex to Develop Internally, and Too Valuable to Ignore
Another trend within the retail industry is the shift away from building AI capabilities entirely in-house. As retailers accelerate investment in AI-driven forecasting, pricing, assortment planning and automation, many are realizing that developing complex AI systems internally is costly and difficult to scale. Instead, retailers are increasingly turning to modular, API-ready platforms with embedded AI capabilities that allow them to deploy forecasting, pricing optimisation and workflow automation faster without adding technical debt.
This reflects wider digital trends in retail, where boards and senior leadership teams are pushing CIOs to deliver clearer AI strategies that generate measurable business outcomes. We believe Gartner® highlights the next evolution of retail AI goes beyond chatbots and analytics with agentic AI capable of identifying anomalies, recommending actions and automating decisions across replenishment, pricing and assortment planning.
AI Is Redefining Retail Cybersecurity, Shifting from a Constraint to a Core Business Strategy
As retail operations become more connected across stores, ecommerce, supply chains and cloud platforms, cybersecurity is becoming far more complex. From our understanding, Gartner® highlights that cybersecurity is no longer just an IT issue; it is increasingly being treated as a core business strategy. With more customer data, connected devices and digital touchpoints across retail environments, the potential impact of cyberattacks now extends far beyond systems alone, affecting operations, fulfilment, customer trust and profitability.
AI is also starting to reshape how retailers approach cybersecurity. Instead of relying solely on traditional rule-based protection, retailers are increasingly investing in AI-powered security tools capable of identifying unusual behaviour, detecting threats faster, and responding in real time. In our opinion, 86% of retail CIOs plan to increase cybersecurity investment in 2026, making it one of the highest technology investment priorities across the sector.
Moving Forward
As retailers prepare for 2026, the focus is shifting toward building more connected, agile, and resilient operations. From modernising legacy systems and improving inventory visibility to supporting frontline teams and strengthening cybersecurity, retailers are increasingly investing in technologies that enable faster decision-making, better customer experiences and stronger operational control. While AI continues to accelerate change across the industry, we believe that the Gartner® report makes one thing clear: retailers that build the right operational foundations now will be far better positioned to adapt, scale and compete in the years ahead.
Access the full report here.
Gartner, Top Retail Trends for CIOs in 2026: Accelerating Retail Modernization and AI-Driven Growth, Kelsie Marian, Jonathan Kutner, Robert Hetu, Tom Nolan, Max Panther Hammond, Sandeep Unni, 6 January 2026
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